S&P Weekly and Daily ChartsOften when markets breakout of the monthly channels they often come back and re-test the breakout and then continue with the overall trend.
This is what's been happening in the US markets at the start of August, a re-test of the June breakout.
There is major resistance around these upper levels, based on the June Breakout and the Monthly 50% levels.
I also pointed out in the Weekly report, that for any UP trend to continue price would come back and re-test the Weekly 50% level, before any new UP trend could continue.
And this is what's happened this week (right chart)
http://usindexweekly.blogspot.com/2008/08/dow-s-weekly-report-9th-august-2008.html
Overall I'm factoring in another wave down this Quarter to bottom out the market in 2008, but that's going to depend how US markets react to this Weekly 50% level and this Friday's close....
A bullish trend should bounce off the Weekly 50% level and continue higher into Friday confirming the break above the 50% levels.
A failure to close out on Friday, and as per Weekly report, I would begin to look for continuation down probably in the last Week of this month.
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